At the heart of the conflict over whether to tear down Birmingham's Southtown and rebuild is a gradual shift in philosophy over the best way to provide government-subsidized housing.

A new trend has been to tear down old, crowded public housing where the poorest people are concentrated and replace those apartments with mixed-income developments meant to attract non-subsidized renters.

Park Place, the HOPE VI plan that replaced the old Metropolitan Gardens community downtown, provides Birmingham's first example of that model.

The $150 million public and private redevelopment project was launched with a $35 million federal grant. By tapping into the demand for downtown housing for urban professionals, developers hoped to be able to profit by renting upscale units that could help underwrite the subsidized renters elsewhere in the complex.

Even its backers say the experiment can work remarkably well, or fail miserably.

"It's very spotty," said Robert D. Lupton, president of Family Consultation Service Urban Ministries, a mixed-income housing pioneer in Atlanta. "When you get bureaucrats running it, they're not tuned in with the market. It has to be economically viable."

Cathy Crenshaw of Sloss Real Estate Group, a private developer of Park Place, said the first two phases are 100 percent leased with 20 percent partial subsidy, 40 percent full subsidy and 40 percent rented at market rates.

"It's a great formula for rebuilding a neighborhood; you need a diverse mix of incomes," she said. "It's a very healthy way to rebuild a city."

One difficulty is that the transitions are painful, Crenshaw said. "You have to move a lot of very poor families out, and then you move them back in."

She would like to see mixed public housing at Southtown.

"That is a superb location," she said. "There could be much higher quality housing. You have to be incredibly sensitive to the people. They have to be actively involved in the process. I don't like to tear down anything if you don't have to."

The old Metropolitan Gardens apartments, similar in style to Southtown, needed to be replaced, she said. "They were horrible, functionally obsolete. Now there are tall ceilings and big windows. They're beautiful. If it's beautiful, it works."

The old-style public housing is increasingly obsolete, she said.

"It's very small rooms; it's not the best design," Crenshaw said. "These things just wear out. It's about how do we build healthy neighborhoods. It's tough on people when you concentrate extreme poverty."